1.Project B requires an Initial (Year 0) Investment of $5,000,000; and will retu
ID: 2695113 • Letter: 1
Question
1.Project B requires an Initial (Year 0) Investment of $5,000,000; and will return $1,115,000 for each year of its five year useful life. What is the project's Internal Rate of Return?
a. 30.74%
b. 3.74%
c. 23.74%
d. 13.74% .
2.A project has up front (Year 0) costs of $75,000; and will generate Cash Flows of 25,000 in its first 2 years and $ 50,000 in Year 3 and $15,000 in Year 4. What is its payback period if the company requires a 14% return on projects of similar risk?
a. 2.25 PERIODS
b. 4.00 PREIODS
c. 2.50 PERIODS
d. 3.00 PERIODS
a. -$1,034,791.00 b. $ 1,842,777.21 c. -$1,232,100.41 d. -$884,500.56Explanation / Answer
1) a) 3.74%
2) b) 2.5 Periods
3) a) -$1,034,791.00
4) c) $657,061
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